please show the step to solutions as possible as you can 8. Which of the followi
ID: 2540814 • Letter: P
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please show the step to solutions as possible as you can
8. Which of the following financial statements is concerned with the c ompany at a point in time? a. Balance sheet b. Income statement c. Retained eamings statement d. Statement of cash flows 9. If total liabilities increased by $75,000 and stockholders equity increased by $25,000 during a period of time, then total assets ust change by what amount and direction during that same period? a. $100,000 decrease b. $100,000 increase c. $125,000 increase d. $150,000 increase 10. Elston Company compiled the following financial information as of December 31, 2014 $700,000 150,000 200,000 625,000 175,000 50,000 25,000 100,000 75,000 375,000 Service revenue Common stock Cash Dividends Supplies Accounts payable Accounts receivable Retained eamings, 1/1/14 Elston's stockholders' equity on December 31, 2014 is a. $525,000 b. $550,000. c. $400,000. d. $600,000. 11. Use the following data to determine the total dollar amount of assets to be classified as current Carne Auto Supplies Balance Sheet December 31, 2014 S 35,000 50,000 70,000 40,000 90,000 95,000 S 65,000 Accounts payable Salaries and wages payable Mortgage payable Total liabilities 10,000 165,000 $120,000 $370.000 $535000 Accounts receivable Prepaid insurance Stock investments $115,000 Buildings Less: Accumulated Common stock Retained eamings 85,000 Total stockholders' equity Total liabilities and Trademarks Total assets stockholders equityExplanation / Answer
Answer 8 is a.
Balance sheet reports year-end values of assets and liabilities. While, income statement, retained earnings statement and statement of cash flows report the changes made during the year.
Answer 9 is b.
Increase in Liabilities = $75,000
Increase in Stockholders’ Equity = $25,000
Increase in Assets = Increase in Liabilities + Increase in Stockholders’ Equity
Increase in Assets = $75,000 + $25,000
Increase in Assets = $100,000
Answer 10 is b.
Net Income = Service Revenue - Operating Expenses
Net Income = $700,000 - $625,000
Net Income = $75,000
Retained Earnings, 31/12/2014 = Retained Earnings, 1/1/14 + Net Income - Dividends
Retained Earnings, 31/12/2014 = $375,000 + $75,000 - $50,000
Retained Earnings, 31/12/2014 = $400,000
Stockholders’ Equity, 31/12/2014 = Common Stock + Retained Earnings, 31/12/2014
Stockholders’ Equity, 31/12/2014 = $150,000 + $400,000
Stockholders’ Equity, 31/12/2014 = $550,000
Answer 11 is a.
Current Assets = Cash + Accounts Receivable + Inventory + Prepaid Insurance
Current Assets = $35,000 + $50,000 + $70,000 + $40,000
Current Assets = $195,000
Answer 12 is c.
Property, Plant and Equipment = Land + Buildings - Accumulated Depreciation
Property, Plant and Equipment = $95,000 + $115,000 - $30,000
Property, Plant and Equipment = $180,000
Answer 13 is c.
Investment = Stock Investments
Investment = $90,000
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